Housing supply is unlikely to improve in the coming months, a new report from estate agent Lisney suggests.
However, it states that more rental homes will become available to buy as private landlords exit the market.
The report reveals that probate office delays are causing uncertainty for buyers, with a grant of probate now taking 22 weeks from lodging.
“Buyers are reluctant to engage with properties when they have no certainty on when a sale could close,” the report states.
“Given that probate sales are making up at least one-third of supply at present (and higher in certain areas), this will further affect supply levels this year.”
David Byrne, Managing Director of Lisney said there are many reasons for the supply constraints in the Irish residential market in the last decade.
“Noteworthy at present is vendor fear around the timing of a sale,” he explained.
“Many believe now is not a good time to sell given the interest rate environment.
“In addition, a catch-22 situation remains where potential vendors cannot sell until they buy and cannot buy until they sell.
“Even if they do try to go ‘sale agreed’ on a new home, some vendors will not engage until their existing home is sold as they do not want to be involved in drawn-out chain sales,” he added.
Today’s report states that high interest rates will continue to impact affordability and repayment capacity for many.
At the upper-end of the market, it said cash buyers dominate, and interest rates are of less relevance.
According to the report, the BER rating of a property is now a major consideration for potential buyers, with almost all asking about the rating before viewing.
Lisney said demand for country homes and estates this year will continue to be driven by those with little or no reliance on mortgage finance.
It said international buyers will be the most active in the Irish country homes market this year, especially for the highest priced properties.